East Asia has led the global recovery since the pandemic, but deep welfare imbalances are now threatening the sustainability of its growth model.

East Asia has led the  global economic recovery since 2020, but its current pace continues to lag behind pre-pandemic levels,  renewing worries about the sustainability of an export-led growth model. But rarely discussed is the reluctance of East Asian leaders to abandon productivism, a welfare strategy that emphasises rapid growth and human capital investment over social protection.

Seen in this light, the region’s growth challenges are symptoms of a welfare imbalance, rather than simply the result of external shocks or diminishing returns to the traditional drivers of expansion. The book  _Misery Beneath the Miracle in East Asia_ not only details the human costs resulting from a productivist orientation, but also finds that a supposedly pro-growth strategy is now hindering economic performance. This happens through three primary channels – decreasing consumption, particularly among the elderly, obstructing the accumulation of human capital and exacerbating the decline in total fertility rates by discouraging marriage and childbirth.

East Asia’s limited social spending has held back the transition away from an over-reliance on capital investment and export promotion. In China, the absence of a comprehensive social welfare system has caused citizens to save at very high rates. Insufficient government support for affordable housing, along with the........

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